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The Market Movers
It was another mixed session for the auto sector. BMW led the way, rising by 1.07%, with Mercedes-Benz Group gaining 0.48%. Continental AG and Porsche rose by 0.28% and 0.11%, respectively, while Volkswagen fell by 0.22%.
It was also a mixed session for the banks. Commerzbank fell by 2.64%, while Deutsche Bank ended the day up 0.74%. Commerzbank was the worst performer on Friday.
The Day Ahead for the DAX
This morning, German industrial production will set the tone. After the surge in factory orders over two consecutive months, weak industrial production figures would refuel recessionary jitters. Economists forecast a 0.4% decline in industrial production.
Later in the session, there are no US economic indicators influence. The lack of economic indicators will leave Fed chatter to move the dial. FOMC members Harker and Bowman are on the calendar to deliver speeches.
DAX Technical Indicators
Looking at the EMAs and the 4-hourly chart, the EMAs sent bearish signals. The DAX sat below the 50-day (16,115) and 200-day (15,962) EMAs, sending bearish near and longer-term price signals.
Significantly, the 50-day EMA narrowed to the 200-day EMA, sending bearish price signals and supporting a DAX return to sub-15,750 to bring the 15,600 – 15,525 support band into play.
However, a DAX move through the 200-day EMA (15,962) and the lower level of the 16,000 – 16,080 resistance band would give the bulls a run at the 50-day EMA (16,115).
The 14-4H RSI sits at 38.41, signaling bearish sentiment, with selling pressure overweighing buying pressure. Significantly, the RSI aligns with the EMA, supporting a return to sub-15,750 to bring the 15,600 – 15,525 support band into play.
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